Cells genetically modified to produce osteoinductive factors have potential for use in enhancing bone regeneration for reconstructive applications. Genetic modification of cells can be accomplished by a variety of gene therapy vectors. In this study we evaluated the ex vivo genetic modification of rat marrow stromal cells (MSCs) by adenoviral, retroviral, and cationic lipid vectors containing the gene for human bone morphogenetic protein 2 (hBMP-2). We investigated both the in vitro and in vivo osteogeneic potential of MSCs modified by each vector. In vitro, we found that only MSCs modified with the adenoviral vector produced detectable hBMP-2 and demonstrated a statistically significant increase in endogenous alkaline phosphatase activity indicative of osteogeneic differentiation. We further investigated the ability of genetically modified MSCs seeded on a titanium mesh scaffold to facilitate bone formation in vivo. In an orthotopic critical-size defect created in the rat cranium, bone formation was observed in all conditions with MSCs modified by the adenoviral vector demonstrating a small but statistically significant increase in bone formation relative to the other vectors and control. Implants in an ectopic location demonstrated minimal bone formation relative to the orthotopic location, with MSCs modified with cationic lipids forming less bone than the other vectors and control. Our results show that MSCs genetically modified with adenovirus containing the hBMP-2 gene had enhanced osteogeneic capacity relative to unmodified MSCs or MSCs modified by the other vectors. This study was the first to compare three different gene therapy vectors for the genetic modification of cells to produce osteoinductive factors for the purpose to enhance bone regeneration.